Precious jewel awaits in the desert

by

Precious jewel awaits in the desert
The Mud Hut Motel

Spectacular Coober Pedy has long been regarded as the “opal capital of the world”. For the accommodation business the desert oasis has also become a gold mine.

While the South Australian outback town still produces an abundance of exquisitely coloured rock, it has become an important centre for government and corporate workers in a variety of fields.

And they all need somewhere to stay.

The Mud Hut Motel has capitalised on the corporate and government accommodation needs for many years. It is a 28-room freehold motel in the unique outback location with a stunning 24.4% return.

The Mud Hut Motel
The Mud Hut Motel

Kelli Crouch from Resort Brokers, who is marketing the property, says it is primarily a corporate motel “with a great tourism overlay.”

She said Coober Pedy had a captive market in the accommodation sector as there were limited options for visitors.

“Coober Pedy is definitely a stopover destination for tourists, but it’s also now a base for a lot of government agencies,” Ms Crouch said.

“They’re coming through that area and working from Coober Pedy in various services through a range of government departments including health and education.

“And this is an excellent property that caters very well to their needs.”

The Mud Hut Motel
The Mud Hut Motel

The motel is on sale for $3.3m with a phenomenal rate of return.

While more than half of the local residents live in “dugouts” built underground to defy the desert heat, Ms Crouch said the motel had 24 “well-appointed above-ground motel rooms” and four two-bedroom apartments.

Other facilities include a commercial kitchen and dining room with seating for 42 guests currently operating for breakfast.

There is a guest laundry, ample parking including space for larger vehicles with trailers, and a recently upgraded reception area.

The fully furnished manager's residence has three spacious bedrooms and an attached carport.

The Mud Hut Motel
The Mud Hut Motel

The property enjoys high occupancy of 84.6% and impressive forward bookings.

There is also a high percentage of direct bookings with good repeat clientele that includes a mix of corporate, government and leisure guests.

The high returns allows a new owner to either run the business as owner-operators or to put it under management. There is also the opportunity for investors to buy the freehold and split off a brand new lease.

The Mud Hut Motel
The Mud Hut Motel

The town of Coober Pedy has a population of about 2000 and was established in 1915 after the first opal finds.

It is 840 kilometres north-west of Adelaide and 700 kilometres south of Alice Springs.

For more than a century, fortune hunters have flocked to Coober Pedy to try their luck digging for the rainbow-colored opals that can be used to form stunning earrings, pendants and necklaces.

Some of the remnants of their underground mines are converted into homes, one of the most famous dugouts being Faye's Underground Home, built into the dusty hills along Gem Place just outside town. 

Faye's Underground Home was built by Faye Nayler, Ettie Hall and Sue Bernard who mined for opals for a decade from 1962. The women opened the house to tourists in 1972 and it remains in its original condition.

Other visitor attractions include the mines and the underground churches – Serbian Orthodox and Catholic.

Coober Pedy is the largest opal mining area in the world but there are also important iron ore, gold, copper and oil reserves in the area that suggest it will be attracting even more visitors in the years to come.

Find the business listing details HERE

Find more accommodation for sale HERE

Find the latest industry news HERE


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